CSRC

I. Listed companies shall introduce independent directors to their boards of directors.

....

III. Independent directors shall meet the "independence" requirements.

A person may not hold the position of the independent director in any of the following circumstances:

1. the person who holds a position in the listed company or its affiliated enterprises, their direct relatives and major social relations (direct relatives refer to their spouse, father, mother and children etc.; major social relations refer to their brothers, sisters, father-in-law, mother-in-law, daughter-in-law, son-in-law, spouse of their brothers, sisters, and their spouse's brothers and sisters etc.);

2. the person who holds more than 1% of the outstanding shares of the listed company directly or indirectly, or the natural person shareholders of the 10 largest shareholders of the listed company, or such shareholder's direct relative;

3. the person who holds a position in a unit which holds more than 5% of the outstanding shares of the listed company directly or indirectly, or of the unit which ranks as one of the 5 largest shareholders of the listed company, or such employee's direct relative;

4. the person meeting any of the three above-mentioned conditions in the immediate proceeding year;

5. the person providing financial, legal or consulting services to the listed company or its subsidiaries;

6. the person stipulated in the articles of association;

7. the person determined by the CSRC.

4.      “affiliation” means the relationship between the controlling shareholder, de facto controlling person, director, supervisor or senior management personnel of a company and an enterprise directly or indirectly by him as well as any other relationship that may lead to a transfer of the interests of the company. However, there shall be no affiliation between State-controlled enterprises merely due to the fact that the State has a controlling interest in both of them.

NYSE

303A.02 Independence Tests  

 In order to tighten the definition of "independent director" for purposes of these standards:

(a) No director qualifies as "independent" unless the board of directors affirmatively determines that the director has no material relationship with the listed company (either directly or as a partner, shareholder or officer of an organization that has a relationship with the company). Companies must identify which directors are independent and disclose the basis for that determination.

(b) In addition, a director is not independent if:

(i) The director is, or has been within the last three years, an employee of the listed company, or an immediate family member is, or has been within the last three years, an executive officer ,¹ of the listed company.

(ii) The director has received, or has an immediate family member who has received, during any twelve-month period within the last three years, more than $100,000 in direct compensation from the listed company, other than director and committee fees and pension or other forms of deferred compensation for prior service (provided such compensation is not contingent in any way on continued service).

(iii) (A) The director or an immediate family member is a current partner of a firm that is the company's internal or external auditor; (B) the director is a current employee of such a firm; (C) the director has an immediate family member who is a current employee of such a firm and who participates in the firm's audit, assurance or tax compliance (but not tax planning) practice; or (D) the director or an immediate family member was within the last three years (but is no longer) a partner or employee of such a firm and personally worked on the listed company's audit within that time.

(iv) The director or an immediate family member is, or has been within the last three years, employed as an executive officer of another company where any of the listed company's present executive officers at the same time serves or served on that company's compensation committee.

(v) The director is a current employee, or an immediate family member is a current executive officer, of a company that has made payments to, or received payments from, the listed company for property or services in an amount which, in any of the last three fiscal years, exceeds the greater of $1 million, or 2% of such other company's consolidated gross revenues.

CalPERS

U.S. Corporate Governance Core Principles and Guidelines

Appendix B: Definition of Independent Director

"Independent director" means a director who:

• Has not been employed by the Company in an executive capacity within the last five years;
• Is not, and is not affiliated with a company that is, an adviser or consultant to the Company or a member of the Company's senior management;
• Is not affiliated with a significant customer or supplier of the Company;
• Has no personal services contract(s) with the Company, or a member of the Company's senior management;
• Is not affiliated with a not-for-profit entity that receives significant contributions from the Company;
• Within the last five years, has not had any business relationship with the Company (other than service as a director) for which the Company has been required to make disclosure under Regulation S-K of the Securities and Exchange Commission;
• Is not employed by a public company at which an executive officer of the Company serves as a director;
• Has not had any of the relationships described above with any affiliate of the Company; and

Link: CalPERS, Why Corporate Governance